UK and International Tax news
Government Delays Basis Period Reform
Monday 27th September 2021
The Government has announced a delay to the introduction of basis period reform to no earlier than April 2024.
In July 2021, HMRC launched a consultation on reforming the rules under which profits of unincorporated businesses are allocated to tax years using basis periods. Further details on this are included in our July UK Tax News.
Following representations made by a number of stakeholders and other interested bodies, the Financial Secretary to the Treasury has confirmed in a written statement that the proposed reform to the basis period rules will not come into effect before April 2024, with a transition year not coming into effect earlier than 2023. The Government will respond to the consultation in due course and provide details of the next steps.
The Financial Secretary also referred in her statement to the challenges faced by many UK businesses and their representatives as the country emerged from the pandemic over the last year. In recognition of this and of stakeholder feedback, she confirmed that MTD for ITSA will also be introduced a year later, in the tax year beginning in April 2024.
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